Corporate identity theft targets small businesses as well as large corporations much like regular identity theft does. Businesses may discover that they are the victims of identity theft when they apply for credit, grants or loans, and find out that their credit is bad. Most people think that identity theft only happens to individuals, but corporate identity theft is on the rise.
The most common form of identity theft is the fraudulent use of a company’s credit profile by thieves. With credit profiles, thieves can easily obtain credit for a separate, oftentimes nonexistent, company, or they can also rack up charges in the company’s name.
Similar to credit scores, all businesses also have credit histories that are used to establish credit with vendors, and much like individuals’ credit, it is important for companies’ credit to remain in good standing. A company cannot obtain credit, buy new equipment or rent a space without a clear credit history.
How it works
Identity thieves steal a company’s credit profile by impersonating them. Once the identity thieves obtain the credit profile, they establish their own accounts and accumulate unauthorized charges. They may also create accounts in the company’s name. All that is required is the company’s account numbers. Identity thieves obtain this information in much the same way they obtain individuals’ information:
Summary
Corporate identity theft, once thought of as rare, is increasing rapidly, and can destroy an entire business’s credit easily. It is important for businesses, no matter how large or small, to educate themselves on corporate identity theft, and take the necessary safeguards to ensure that their businesses are protected. Once a thief obtains a company’s sensitive information, they are able to change the registered address of a business, the director of the company, and they can also appoint new directors. It is important to take action against corporate identity thieves by securing all sensitive company information.